Govt for building LNG terminal by 2016

The government has decided to construct the first liquefied natural gas (LNG) terminal at Moheshkhali by 2016 with a view to importing LNG to meet the growing demand for energy in the country.

"The LNG terminal having capacity of 1,38,000 cubic metre LNG would be constructed under Build-Own-Operate-Transfer (BOOT) at Moheshkhali to meet the growing demand of the gas," Secretary of Energy and Mineral Resources Division of Power, Energy and Mineral Resources Ministry Abubakar Siddique told BSS on Thursday.

He said the terminal is expected to supply 500 million metre standard cubic feet per day (mmscfd) from the floating storage and re-gasification unit (FSRU)-based LNG terminal by 2016.

According to the project, the government would sign a deal with Astra Oil and Excelerate Energy Consortium to build the floating storage and FSRU terminal at its own cost at Moheshkhali Island in the Bay of Bengal.

The proposal of the deal with detailed information was sent to the Cabinet Committee on Economic Affairs for approval on December 31 for approval.

After approval by the committee, the government will sign the deal with AEC which will set up the LNG terminal with installation of 91 kilometre gas transmission pipelines with 30 diametre from Moheshkhali to Chittagong.

As per the project, the contractor will implement the project on a BOOT basis for 15 years and it would be transferred to the government after the 15 years.

The Petrobangla would also provide US$90.16 million annually to AEC, while the company will deposit $2.0 million as Term Sheet Security during signing of the Term Sheet Agreement.

The project details said that the Terminal Company will deposit performance bond $20 million during the signing ceremony of Terminal Use Agreement.

Earlier, the state-owned Petrobangla signed the Term Sheet Agreement with the company on June 26, 2014 aimed at supplying 500 mmscfd gas and completing study from its own resources.